When my dad died, my two brothers and I each inherited 1/3 of his mineral rights as individual owners and his ex-wife (our mom) inherited a 1/4 lifetime estate of the income generated from those mineral rights. However, one of my brothers (Brother 1) will die from a terminal illness soon and he intends to leave the 1/3 he inherited to mom. I am trying to figure out how would this work going forward - how does she continue to recieve 1/4 lifetime estate on something she now owns? I am assuming that she would still recieve 1/4 of the income generated from what I own and what the other brother owns, but does the 1/4 she was getting from what Brother 1 owned just go away because now she will owns his mineral rights? And how do the oil&gas companies figure this out - do we just leave it up to them (which seem like a recipe for disaster) or how would we spell this out to them so they get it right?
It seems that the estate went 1/4 directly to each son and the other 1/4 into a life estate for Mom. Upon her death, the 1/4 life estate would be divided among the 3 sons. If Son A gives his 1/4 minerals to Mom, then she will have 1/4 minerals plus the 1/4 life estate. So she will receive the royalties on 1/2 of your father’s minerals. Upon her death, she can leave the 1/4 minerals to anyone she wants. The 1/4 life estate will pass in accordance with the terms of your father’s will. Often a life estate will pass to the surviving sons and to the children of a deceased son. Assuming that your brother has no children, then the 1/4 would pass to the 2 remaining sons. However, you will have to read the terms of the life estate to be certain how it will pass. It is always possible that it passes to the 3 sons and if one is deceased then to his heirs at law.
Is your mother receiving any revenue now? If so, then the oil company will just simply pay your mother the brother’s share.
Now, the proper division differs from state to state. At common law, the life estate owner only received the interest, and the other funds went into an account to be paid to the remainderman upon the life tenant’s death.
She is receiving her share of the revenue now.
Technically, she doesn’t own the mineral rights but you are right, 1/4 of income goes to each child and the other 1/4 goes to her until she dies. But I see what you are saying she gets her 1/4 + my brother’s 1/4 so she would then be getting half the income.
Of course your mother does not own the 1/4 minerals in the life estate. That interest will vest in the remaindermen in accordance with the terms specified in your father’s will. However, if your brother wills his currently vested 1/4 minerals to your mother outright, then she will own Brother’s 1/4 minerals and she can give that to anyone.